Arico v The Queen

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S APCR 2017 0047

ROCCO ARICO	Applicant
v
THE QUEEN	Respondent

S APCR 2017 0048

ROCCO ARICO	Applicant
v
THE QUEEN	Respondent

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JUDGES:	MAXWELL ACJ, WEINBERG and PRIEST JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	8 February 2018
DATE OF JUDGMENT:	24 May 2018
MEDIUM NEUTRAL CITATION:	[2018] VSCA 135	First Revision: 10 November 2020 [342]
JUDGMENT APPEALED FROM:	DPP v Arico (Unreported, County Court of Victoria, Judge Chettle, 10 November 2016 (Conviction), 3 March 2017 (Sentence))

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CRIMINAL LAW – Appeal – Conviction – Extortion – Trafficking in large commercial quantity of drug of dependence (ice) – Offer to sell drugs – Whether offer genuine – Whether conviction unsafe – Evidence of finding of gun and ammunition in applicant’s possession – Whether relevant to extortion and/or trafficking charges – Whether danger of unfair prejudice outweighed probative value – Defence counsel conceded relevance – No anti-propensity direction sought – Leave to appeal refused – Drugs, Poisons and Controlled Substances Act 1981 s 71, Evidence Act 2008 s 137, Jury Directions Act 2015 ss 11–12.

EVIDENCE – Admissibility – Criminal trial – Charges of extortion, drug trafficking – Evidence of finding of gun and ammunition in applicant’s possession – Whether relevant – Whether danger of unfair prejudice outweighed probative value – Extortion charges based on threats to shoot – Whether applicant in business of drug trafficking – Circumstantial case –— Indicia of drug trafficking — Evidence admissible — Evidence Act 2008 ss 55, 137.

CRIMINAL LAW – Appeal – Sentence – Trafficking in large commercial quantity – Offer to sell drugs – Plea of not guilty – Sentence of nine years’ imprisonment – Whether manifestly excessive – Whether offer to sell less serious form of trafficking – Consideration of risk of harm – Appeal allowed – Resentenced to seven years’ imprisonment – Drugs, Poisons and Controlled Substances Act 1981 s 71.

WORDS AND PHRASES – ‘Offer for sale’, ‘accoutrements of drug trafficking’, ‘tools of trade’.

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APPEARANCES:	Counsel	Solicitors
For the Applicant	Mr O P Holdenson QC with Mr J O’Connor	Condello Lawyers
For the Crown	Ms F Dalziel	Mr J Cain, Solicitor for Public Prosecutions

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PART 1: CONVICTION APPEAL (S APCR 2017 0048)

MAXWELL ACJ
WEINBERG JA:

The applicant stood trial in the County Court at Melbourne on three charges of extortion (charges 1, 2 and 6), one charge of intentionally causing injury (charge 3), and one of trafficking in a drug of dependence (methylamphetamine) (‘ice’) in not less than a large commercial quantity (charge 5) (‘the first trial’). On 10 November 2016, he was convicted of these five offences. Charge 4 was an alternative to charge 3, and no verdict was therefore taken in relation to that charge.

In February 2017, the applicant again faced trial in the County Court (‘the second trial’). He was convicted of one charge of being a prohibited person in possession of a firearm (charge 1), and one charge of possessing a drug of dependence (charge 3).

On 3 March 2017, the applicant was sentenced in respect of both trials to a total term of 14 years’ imprisonment with a non-parole period of 10 years. He now seeks leave to appeal against conviction in respect of all five offences of which he was found guilty in the first trial. He also seeks leave to appeal against sentence in respect of both trials.

The reasons for judgment are in two parts. Part 1 deals with the conviction application. Part 2 deals with the sentence application.

We have had the advantage of reading in draft the reasons for judgment of Priest JA concerning the conviction application. There were originally three proposed grounds of appeal. Ground 1 was abandoned prior to the hearing before this Court. Ground 3 contends that the verdict on charge 5 in the first trial is unreasonable and/or cannot be supported having regard to the evidence.[1] Priest JA would refuse leave to appeal on that ground. We respectfully agree with his Honour’s analysis and conclusions regarding that ground, and have nothing further to add.
[1]Criminal Procedure Act 2009 s 276(1)(a).

As to ground 2, the trial judge permitted evidence to be led of the discovery of a firearm and ammunition under the seat of a Vespa motorcycle located at the applicant’s residence. The evidence was led in support of the extortion charges (charges 1 and 2) and the drug trafficking charge (charge 5). Ground 2 contends that this evidence should have been excluded entirely either because it was not relevant to any fact in issue or alternatively under s 137 of the Evidence Act 2008 (‘the Act’).

Priest JA would allow the appeal against conviction on this ground. For the reasons that follow, we respectfully disagree. We would refuse leave to appeal against conviction.

Brief summary of background facts

The case against the applicant turned primarily upon the evidence of Witness A, who had for many years been an associate of the applicant.

In order to understand the context within which the offences charged in the first trial were said to have been committed, it is necessary to have regard to Witness A’s evidence regarding events that went back as far as December 2010.

On either 22 or 23 December 2010, Witness A and another associate of the applicant, Michael Pastras, agreed to sell a kilo of cocaine to a man named Toby Mitchell. Witness A said that he approached the applicant, who supplied him with the cocaine for $350,000. Witness A had earlier agreed to sell the cocaine to Mitchell for $375,000.

Witness A claimed that he had been dealing in drugs on behalf of the applicant for a considerable period prior to December 2010. He added that, in face-to-face discussions with the applicant, certain gestures were used to signify the relevant type and quantity of the drug in question. If it was cocaine, one or other of them would point to his nose. If it was ice, they would point to their eye.

According to Witness A, when the transaction with Mitchell took place, Mitchell collected the cocaine but did not hand over the $375,000. Rather, he gave Witness A a box which turned out to contain a collection of magazines. Witness A said that he had then told the applicant that Mitchell had ripped him off.

Witness A soon after arranged to meet Mitchell. He was accompanied by Pastras and a third person (‘E’). Witness A arranged for E to remain in the car, armed with a gun, while he himself spoke with Mitchell.

The meeting did not go well. Mitchell and an unknown person attacked Witness A and Pastras. Pastras was rendered unconscious. Another car approached and, according to Witness A, there was an exchange of gun fire.

Later, Witness A rang the applicant, who met them at E’s house. The applicant offered to speak to Mitchell on Witness A’s behalf. According to Witness A, the applicant did so but was told by Mitchell that it was Pastras who had stolen the money. Witness A said that the applicant told him that he could either pay the $350,000 owing, or kill Mitchell. Witness A said that he elected to repay the outstanding amount.

According to Witness A, he borrowed $100,000 from his brother, and gave it to the applicant. He said that he carried out a number of interstate and local drug transactions on behalf of the applicant in order to ‘work off’ the remaining debt.

When asked what this involved, Witness A said that he carried drugs to Perth on the applicant’s behalf. He said there were three such trips to Perth in 2011, over a period of some six months. He said that he booked those trips to Perth under false names, but he used his own name for the return trips to Melbourne.

Witness A claimed that he had paid off a total of $300,000 of the $350,000 debt by this means. The applicant told him that he would forgive the extra $50,000, which was to be the applicant’s profit margin on the transaction.

In late 2011, Mitchell was shot and seriously injured. The applicant asked Witness A if he was responsible for the attack on Mitchell, and Witness A falsely said that he was.

In early 2013, the applicant discovered that Witness A had lied to him. He confronted Witness A, and told him that the $50,000 debt that he had previously forgiven now had to be repaid.

In mid-2013, Witness A moved house. Thereafter, a number of incidents took place. The words ‘pay your bills’ were spray painted on the outside of a car belonging to the wife of witness A (to whom we will refer as ‘B’). The same words were painted on the letterbox and on the house itself. According to Witness A, he confronted the applicant about this and was told that the debt he owed would not go away.

On 14 April 2014, at about 3.30 am, a rock and a pot plant were thrown through the window of Witness A’s house, and the house was set on fire. CCTV footage captured two men carrying out that offence. Subsequently, Witness A’s father’s car was vandalised.

Shortly thereafter, the applicant and Savas Pastras (Michael’s brother) met with Witness A. The applicant told Witness A that the amount owing had increased from $50,000 to $100,000. The applicant said that, unless that amount was paid, Witness A’s father’s house would be blown up.

It was at this stage that Witness A made a statement to police, which triggered an investigation into these matters.

On 13 July 2014, the applicant told Witness A that unless he paid the sum of $100,000, plus $10,000 GST, the applicant would ‘shoot up’ both Witness A’s mother’s house, and his brother’s house. This threat formed the basis of charge 1 (extortion).

Subsequently, the applicant organised for a false invoice to be prepared, whereby it would appear that a considerable amount of work had been done on Witness A’s house by a builder and friend of the applicant (‘J’). The idea was to convert Witness A’s drug debt into what appeared to be a legally enforceable debt. It seems to have been contemplated that J would lodge a caveat, ostensibly to protect his interest under the sham invoice. Witness A would then sell his house. The applicant would ultimately collect his $110,000 from the proceeds of the sale. The origins of the debt would thereby be concealed.

On 11 September 2014, the applicant attended Witness A’s house in order to implement these arrangements. He knocked on the front door and told Witness A that, unless he and his wife signed the sham agreement and acknowledgement of debt to J, he would shoot them. That conduct formed the basis of charge 2 (extortion).

According to Witness A, he told the applicant to ‘fuck off’. Witness A claimed that the applicant then struck him to the jaw with his fist, causing him minor injury. That conduct formed the basis of charge 3 (intentionally causing injury). Witness A said that thereafter, both he and his wife signed the sham agreement between themselves and J.

The plan to sell Witness A’s house failed because various people had lodged caveats over the property. The applicant then wanted Witness A and his wife to obtain a bank loan against the property in order to pay him back the money he claimed to be owed. Because the house was in B’s name, the applicant demanded that she arrange such a loan. When she failed to do so, the applicant rang Witness A. That call was secretly recorded by police on 26 February 2015.

The applicant was very angry. He said that B:

can’t get away with it … her brother will get a message very shortly anyway, don’t worry, don’t worry. I know where he is and I’ve got friends [of] mine there with him. He’s gonna get a message very, very, shortly. We’ll start with the brother first, okay, then we’ll work out the rest after, okay.
…
She swore on her fuckin’ kids to my face and shook my hand and apologised to me for fuckin’ the bloke around, and said that she’d pay.
…
If she doesn’t come and fuckin’ see me, I’m tellin’ ya now, in seven days - I’m givin’ ya seven days. If she doesn’t come and see me, well then don’t worry about it. I’m tellin’ ya now. You tell her and come and see me because you’re not gonna suffer, she will. Believe me.

B’s brother was in prison at the time. The applicant’s threat over the phone formed the basis of charge 6 (extortion).

A week earlier, on 19 February 2015, as part of his plan to recover the debt purportedly owed by Witness A, the applicant met with him at a real estate agent’s office in Brunswick. That meeting was covertly tape recorded by Witness A, who had been ‘wired up’ by the police. Witness A handed over $25,000 in cash which the police had provided to him. They discussed B’s failure to arrange the bank loan. The applicant indicated that he wanted her to do so, and that he would provide a banker who could organise it.

At some point, well into the conversation, the discussion turned to drugs. The applicant offered to sell Witness A as much ice as he wanted, for $145,000 per kilo. He assured Witness A that the quality of the drug was good, and he claimed that he could obtain it from ‘the Asians’.

That discussion concerning drugs formed the basis of charge 5, in the first trial. As indicated, that was a charge of trafficking methylamphetamine, in not less than a large commercial quantity. The form of trafficking alleged was an ‘offer for sale’.[2]
[2]Drugs, Poisons and Controlled Substances Act 1981 s 70 (definition of ‘traffick’) (‘DPCS Act’).

It is necessary at this stage to set out precisely what form the conversation regarding drugs took. The key passages are as follows:

Witness A: I’ll see you Monday, all right?
Applicant: You don’t want me to take your rort over?
Witness A: No.
Applicant: Hey? I cleaned already ya bastard.
Witness A: Bullshit.
Applicant: (Laughs) Yeah.
Witness A: Swear.
Applicant: Yeah, it’s the best.
Witness A: Swear on your daughter.
Applicant: I’m not going to swear on my daughter on that shit. I recruited him already. You think I’m going to wait for you, you banana.
Witness A: Thanks.
Applicant: What do you means thanks? I haven’t but I will. You want to be in on it or not?
Witness A: Yeah.
Applicant: Well … bring him. I’ve got someone else that can take it to him otherwise.
Witness A: What for? Why?
Applicant: Well you bring him.
Witness A: He’s my mate.
Applicant: Well, bring him. There’s time now. Trust me.
Witness A: How many?
Applicant: Whatever you want.
Witness A: How much?
Applicant: How much you want a ‘bomb’?
Witness A: Nah…How much?
Applicant: Hey? Hey? A little kick. (whispers) I’ll give you (inaudible) one forty five dyno.
Witness A: Bollocks.[3]
[3]This was a colloquial translation of a Greek word (footnote added).
Applicant: Dyno.
Witness A: Bollocks. Fucking bullshit.
Applicant: Here. Shake. My word.
Witness A: (Inaudible) Yeah … How much did you do it for?
Applicant: No, no, no …
Witness A: Swear.
Applicant: I give you my word.
Witness A: Swear.
Applicant: I just gave you my word you fucking idiot. What’s wrong with you?
([Z] returns)
[Z]: That’s the landscape yeah? The advertising, the whole thing comes to $20,950.
Applicant: Fucking cheap.
[Z]: All right? And there’s been no interest incurred.
Witness A: Let’s not pay interest, we’re going to resolve this next week, all right? Hold on to it, hold on to it.
Applicant: Hey I give you my word.
Witness A: One hundred and forty five?
Applicant: Yeah.
Witness A: For one of that?
Applicant: Dyno. As many as you want.
Witness A: Bollocks, bollocks…(inaudible)…shit.
Applicant: I give you my word. Dyno. (inaudible word)
Witness A: How big is it?
Applicant: Huh?
Witness A: How big?
Applicant: (inaudible)
Witness A: How big?
Applicant: Fucking like that. They’re ‘Mickey’[4], they … it’s the best around.
Witness A: Yeah yeah.
Applicant: From the Asians.
[4]According to Witness A, ‘Mickey’ was short for ‘Mickey Mouse’, which was slang for grouse, or high quality (footnote added).
Witness A: Asians?
Applicant: Yeah. From there. I give you my word you fucking idiot. Have I ever lied to you?
Witness A: No, I’ll speak to you Monday.
Applicant: No problem.[5]

[5]Emphasis added.

The successful prosecution of charge 5 depended entirely upon what the jury made of that conversation. They had to consider what was said, in the light of evidence given about the conversation by both Witness A and the applicant.

Witness A said that during the conversation the applicant had pointed to his eye, signifying ice. He said that the applicant had also showed him a car key, which he understood to be a reference to a kilo. Finally, he said that the term ‘dyno’, which the applicant used, meant ‘dynamite’ — slang for ‘pure’, or high quality.

When the applicant gave evidence, he claimed that despite what had been said, he was not seriously offering to sell drugs. Rather, he had simply been joking, or testing Witness A. In his own terms, he said that was ‘sussing out’ Witness A because he believed that he may have gone back to his ‘old ways’, and reverted to dealing drugs. He claimed that it was the fact that Witness A had $25,000 in cash that led him to that belief.

The jury, by their verdict, plainly rejected the applicant’s account of the conversation. It should be noted that the prosecution, at the request of the defence, called J to give evidence. He said that the applicant had told him, before speaking to Witness A, that he did not trust Witness A. He had said ‘I’m just going to test him out again, play with him’. He said that he thought Witness A was ‘up to something’, that he was ‘up to his old tricks’ and that he was going to ‘play’ with him, ‘try him out’.

The prosecutor applied, pursuant to s 38 of the Act, to cross-examine J on the basis that he had made a prior inconsistent statement regarding the events of 19 February 2015. Leave was granted.

The earlier statement had been made some three weeks or so after the secretly recorded conversation. J had not said anything then about the applicant ‘testing’ Witness A out, or not trusting him. It was put to J that he had simply made up that part of his story. The prosecutor ultimately invited the jury to reject that evidence entirely.

The applicant was arrested on 5 March 2015, in the car park of the Eureka Apartment building in Southbank. He was carrying a satchel in which police found the key to a black Vespa motor scooter parked in the carpark, adjacent to where the applicant’s car was parked. Locked in a compartment under the seat of the motor scooter, police found a .45 semi-automatic pistol, three boxes of ammunition and a glass bottle of 1,4-Butanediol (a drug of dependence).

Ground 2: admissibility of incriminating items

Ground 2 was in the following terms:

The learned trial judge erred, and his judicial discretion miscarried, by his refusal to exclude from the trial, evidence of the discovery of a firearm and cartridges in the boot of the Vespa motor cycle, found close to the car-parking spots for the applicant and his wife, upon the execution of the search warrant on 5 March 2015, at the residential premises of the applicant, and by failing to find that the probative value of such evidence was outweighed by the danger of unfair prejudice to the applicant.

In considering the challenge to the admissibility in the first trial of the finding of the gun and ammunition, it is necessary to pay close attention to the authorities. Priest JA has undertaken that task, and we gratefully adopt what his Honour has distilled from the cases. We would add only the following.

There has long been a debate as to the principles governing the admissibility of evidence of incriminating objects found in the possession of an accused person. That issue has sometimes become conflated with the common law principles governing the admissibility of what was formerly called ‘similar fact evidence’. Yet there are, and always were, conceptual differences between them.

A useful starting point is the notorious case of Thompson v The King.[6] There, the accused was convicted of gross indecency with two boys. The acts with which he was charged were said to have taken place on a particular day in March. The person who performed those acts was alleged to have made a further appointment with the boys three days later. In the meantime, the police were informed and kept watch, along with one of the boys, at a public lavatory, the appointed rendezvous. The boy pointed out the accused to the police and he was arrested. The accused maintained that it was a case of mistaken identity.
[6][1918] AC 221.

It was held that evidence of various indecent photographs of boys that were found in his room, and of items said to be indicative of homosexuality that he had on his person (including powder puffs), had been correctly admitted. The reasoning of the House of Lords in this case obviously reflects archaic notions. The case would almost certainly be decided differently today. Nonetheless, the basic principles embodied within the decision have been applied many times since.

Next there is the celebrated case of R v Armstrong.[7] There, a solicitor was charged with having murdered his wife by poisoning. His defence was that she had committed suicide. When arrested, he was found to be in possession of a considerable quantity of arsenic. He said that he had purchased it for the purpose of killing weeds. Evidence was led that he had attempted to poison a man with arsenic some eight months or so after his wife had died. That evidence was held to have been correctly admitted. It suggested that he was lying when he said that he had purchased the arsenic for an innocent purpose.
[7][1922] 2 KB 555.

In the same way, in R v Hodges,[8] the accused was charged with being in possession of house breaking implements by night, without lawful excuse. He was found in possession of two skeleton keys, one of which had been filed down. His defence was that he had filed down one of these keys in order to get into his own lodgings. Evidence that he had shown the keys, or substantially similar ones, to two witnesses, with the suggestion that they should ‘join him in an office-breaking enterprise’, was held to have been correctly admitted.
[8](1957) 41 Cr App R 218.

Evidence of the possession of incriminating objects is often led to negate an alibi, or the possibility of mistaken identification. It is not essential, in such cases, that the incriminating material be shown to have been used in the actual commission of the crime charged.

In Thompson and Wran v The Queen,[9] the appellants were tried on charges of breaking, entering and stealing. The prosecution led evidence that, when arrested, they had in their possession implements for opening or breaking into safes. These included tools which clearly had not been used in the commission of the particular offences charged, as explosives had been used to blow open those particular safes.
[9](1968) 117 CLR 313 (‘Thompson and Wran’).

The High Court held that the safe-breaking implements had been wrongly admitted. Priest JA has helpfully set out a number of passages from the joint judgment of Barwick CJ and Menzies J (with whom McTiernan J agreed).[10] We would add to those passages the remarks in the joint judgment that immediately preceded them:

Evidence that the prisoners had in their possession material, which might have been used to break into and to steal from the Darwin Bowling Club or the Darwin Squash Centre, or, was of the same character as what was used in the commission of those crimes, was admissible to identify them with the crimes, e.g., a jemmy to break in, or a supply of gelignite, detonators, wires and batteries, suitable for the blowing of the safes. Some of the evidence admitted, however — of which instances have already been given — did no more than tend to show that the prisoners were well-equipped safebreakers.
We do not think that evidence of the possession of tools for the commission of crime is admissible only when it appears that tools of that nature were used in carrying out the alleged crime; it is sufficient if such tools might have been so used: R v Sims … where Goddard C.J. said: ‘Thus, in the case of burglary, evidence is admissible that housebreaking implements such as might have been used in the crime were found in the possession of the accused.’[11]

[10]See [265]-[266] below.

[11]Thompson and Wran (1968) 117 CLR 313, 316 (citations omitted).

Priest JA has also dealt with a number of other relevant authorities dealing with the admissibility of incriminating material found in the possession of an accused.[12] Once again we gratefully adopt his Honour’s analysis of those cases.
[12]His Honour discusses Driscoll v The Queen (1977) 137 CLR 517, R v Sultana (1994) 74 A Crim R 27, R vBlackwell (1996) 87 A Crim R 289, R v Edwards [1998] 2 VR 354, Festa v The Queen (2001) 208 CLR 593, R v Tracey [No 6] [2005] SASC 360 and R v Debs (2008) 191 A Crim R 231.

Recent authority on the admissibility of incriminating material found in the possession of an accused supports the conclusion that such evidence can be led even if the items in question cannot positively be linked to the commission of the particular offence charged.

In Falzon v The Queen,[13] the applicant was convicted of cultivation of a commercial quantity of cannabis, and of trafficking in a drug of dependence. The particular form of trafficking was said to have been possession of the drug for sale. The issue on appeal was whether evidence of the finding of a large amount of cash at the accused’s property, some $120,800, had been properly admitted in support of the charge of trafficking.
[13][2017] VSCA 74 (‘Falzon’).

It was submitted on behalf of the applicant that the evidence concerning the cash was irrelevant, and therefore inadmissible. Alternatively, it was submitted that even if the low threshold for admissibility posed by s 55 of the Act had been met, the evidence ought to have been excluded as having been ‘unfairly prejudicial’, pursuant to s 137 of that Act.

It should be noted that in Falzon, a substantial body of circumstantial evidence was led in support of what was said to be the ‘business of trafficking’ in a Giretti[14] sense. It was contended by the applicant that, rationally, the only use that the jury were likely to make of the finding of the cash would be to conclude that he was a major drug dealer, and that these were the proceeds of past sales. It was further contended that the jury would inevitably regard such evidence as bearing upon the applicant’s tendency to engage in large-scale drug dealing, in circumstances where there had been no application under s 97 of the Act for the evidence to be led for that purpose. Moreover, it was submitted, the evidence concerning the finding of the cash could not, save through tendency reasoning, shed any light upon the applicant’s intention, so far as the drugs found in his possession were concerned.
[14]Giretti v The Queen (1986) 24 A Crim R 112 (‘Giretti’).

In a joint judgment, the majority (Priest and Beach JJA) held that the evidence concerning the finding of the cash had been wrongly admitted, and that there should be a new trial. In their Honours’ view, each of the authorities was fact-specific and the evidence in question had no relevance to the case against the appellant as formulated by the prosecution.

Justice Whelan dissented. His Honour applied the reasoning of the New South Wales Court of Criminal Appeal in R vSultana.[15]One of the charges in that case concerned supply of heroin. When the appellant was arrested, he had been found to be in possession of that substance. When his home was searched, a number of items said to be typically associated with drug trafficking were located. There were resealable plastic bags, a coffee grinder with white powder residue and other equipment, and some $29,000 in cash. Importantly for present purposes, a replica revolver and pen pistol were also found. One of the grounds of appeal was that the trial judge had erred in admitting evidence of the various items found at the appellant’s home including, in particular, the firearms.
[15](1994) 74 A Crim R 27 (‘Sultana’).

In Sultana, Gleeson CJ (with whom Handley JA agreed) concluded that the evidence concerning the finding of the various items was properly admitted because it tended to show that ‘the appellant was in the business of dealing in drugs’.[16] Chief Justice Gleeson observed that this was ‘not mere evidence of propensity to commit crime, or bad character’.[17]
[16]Ibid 28. Sully J also found that the evidence had been correctly admitted.
[17]Ibid 29.

Justice Whelan, in Falzon, also referred to R vEdwards,[18] where the appellant had been convicted of trafficking in a drug of dependence. A search of his person and of a car in which he was travelling had revealed plastic bags containing drugs, a sum of $2,950 in cash in one of his pockets, and again, importantly for present purposes, a firearm. It was submitted on appeal that this evidence should have been excluded. This Court (per Eames AJA, with whom Hayne and Batt JJA agreed) held that the evidence of the finding of the firearm had been properly admitted. It was stated that the jury might regard the possession of a gun as an ‘accoutrement’ of drug trafficking.[19]
[18][1998] 2 VR 354 (‘Edwards’).
[19]Ibid 368.

In Edwards, the Court cited with approval the following statement by Gleeson CJ in Sultana:

Common sense indicates that supplying heroin on the street, as the appellant is alleged to have done, is a dangerous activity. A jury would be entitled to reason that possessing firearms, or imitation firearms, would be appropriate to the business of a street heroin dealer, and in considering whether the appellant was in that line of business, it was logically open to them to take into account the appellant’s possession of such firearms. That line of reasoning would not depend upon evidence or inference that all, or even most, heroin dealers carry weapons. Nor would it depend upon the premise that possessing weapons tends to indicate that the possessor is a drug-dealer as distinct from a person in some other line of dangerous work. None of the items in question, standing alone, would point to the nature of the appellant’s occupation. It is their combined effect, in conjunction with the other evidence in the case, that is important.[20]

[20]Sultana (1994) 74 A Crim R 27, 29–30 (emphasis added). See Edwards [1998] 2 VR 354, 368–9.

In R v Blackwell,[21] to which Whelan JA also referred in Falzon, the main issue was whether the evidence of the finding, in the possession of the applicant, of a pen pistol and a can of mace was admissible on a charge of possessing heroin for the purpose of sale. The pen pistol was located inside the applicant’s house, and not on his person. Nonetheless, it was said to be well known that drug dealers ‘may become involved in situations which place their personal safety at risk’, and that it was ‘not unknown for dealers to arm themselves with protective devices’ such as pen pistols.[22]
[21](1996) 87 A Crim R 289 (‘Blackwell’).
[22]Ibid 290.

Accordingly, the finding of such a weapon in the possession of the accused could provide circumstantial support for the prosecution case. It was said in Blackwell that the finding of:

items commonly associated with drug dealing … usually will be relevant as part of the circumstantial material to establish the purpose for which the drug was in that person’s possession.[23]

[23](1996) 87 A Crim R 289, 290. See also R vMcGhee (1993) 61 SASR 208, 209–10.

In Falzon, Priest and Beach JJA noted that the charge of trafficking there under consideration was not founded on any actual sale.[24] It was submitted that, contrary to the prosecutor’s contention, the charge in Falzon had not been laid as a Giretti count. Rather, it had been laid on the basis of possession for sale on a single day. On that analysis, their Honours concluded, the evidence of the finding of the cash did not even meet the low threshold for relevance under s 55(1) of the Act, still less could it overcome the balancing exercise required under s 137.
[24]Falzon [2017] VSCA 74 [128].

Priest and Beach JJA distinguished Sultana and Blackwell on the basis that the facts were materially different from those relied on to support the charge of trafficking in Falzon. They noted that a number of the items held to be admissible in those cases were commonly associated with drug dealing. These included paraphernalia such as resealable bags and scales. The same could not be said of an amount of cash, no matter how substantial that amount might be.

Their Honours noted that, in the cases where firearms or other weapons had been located in the context of alleged drug trafficking, there was seldom any temporal gap between the possession of the drugs and the finding of the weapons in question. They said:

Ordinarily, it is the combination of the finding of a sum of cash in proximity to other incriminating articles which will go to support a guilty inference as to the origins of the cash or a person’s reasons for its possession. Thus, it has been held that the finding of cash contiguously with other incriminating articles which are themselves the accoutrements of the illicit drug trade — drugs, firearms and other weapons, cutting agents, scales and the like — might be relevant in proof of an accused person’s participation in such activity. In the present case, however, there was no attempt by the prosecution to show a relationship between the sum of cash found at the applicant’s home and the trafficking — by way of possession for sale — at the Sunshine North or Sydenham premises. The finding of the cash was suspicious, but nothing more.[25]

[25]Ibid [145] (emphasis added).

Falzon is obviously relevant to the determination of the present application. The decision of the majority would, on its face, support the proposition that the evidence of the finding of the gun and ammunition concealed in the Vespa ought to have been excluded, at least in relation to charge 5.

As recently as 19 April 2018, however, Falzon came before the High Court by grant of special leave. Immediately after hearing argument, the High Court — somewhat unusually — ordered that the appeal be allowed. The Court said that reasons would follow.[26]
[26]R v Falzon [2018] HCA Trans 68 (19 April 2018).

We have read the transcript of argument before the High Court. Although it is impossible to anticipate precisely what the High Court will say in its reasons for judgment, the orders made by the Court indicate that Whelan JA’s reasoning is likely to be approved in preference to that of the majority, and that Gleeson CJ’s approach in Sultana is likely to be endorsed.

There are, of course, many other cases that deal with the admissibility of evidence of the finding of firearms which are not necessarily linked to the commission of the offence charged. For example, in R vDebs,[27] the finding of a Smith & Wesson revolver and a quantity of ammunition at the applicant’s mother’s house was held to be admissible on a charge of murder. This was on the basis that it showed that the accused might have had access to a weapon and ammunition of the same kind as had been used in the commission of the offence charged.
[27](2008) 191 A Crim R 231 (‘Debs’).

The better view of the authorities, as they presently stand, seems to be that evidence of the discovery of a firearm in the possession of an accused will be relevant if it can in some way be linked to the offence with which that accused is charged. Such evidence will not necessarily be found to be unfairly prejudicial for the purpose of s 137 of the Act.

Was the evidence relevant to charges 1 and 2 (extortion)?

As indicated, Priest JA would allow the appeal against conviction on charges 1 and 2 on the basis that the trial judge erred in permitting evidence to be led of the finding of the gun and ammunition (‘the gun evidence’). In relation to those charges, his Honour considers the probative value of the evidence was weak and that it was outweighed by the danger of unfair prejudice, in the sense spoken of in s 137.[28] We respectfully disagree.
[28]See [287]–[288] below.

If, as the prosecution contended, the applicant was in possession of the Vespa and its contents at the time of his arrest, that fact alone could ‘rationally affect the probability of the existence of a fact in issue’ in the proceeding.[29] The fact in issue in relation to charges 1 and 2 was whether, as Witness A claimed, the applicant had on two separate occasions threatened to ‘shoot’ him or members of his family, or ‘shoot up’ their property.
[29]That being the test for relevance under s 55 of the Act.

In arriving at that conclusion, we bear in mind that in this country a threat to ‘shoot’ someone is somewhat unusual. It would be rare for any ordinary member of this community to have in their possession a semi-automatic handgun. While threats to injure or even kill are not so uncommon, Witness A’s claims that the applicant threatened to shoot him fall into an altogether different category.

According to the applicant’s own evidence, he had had the keys to the Vespa in his possession for anything up to 12 months before the date of his arrest.[30] That meant that it could be readily inferred that, at the time of the alleged threats, he had available to him the ready means of carrying out those threats. That inference was capable of adding considerable cogency to Witness A’s account. It must be remembered that the threshold test for relevance under s 55 is not particularly high.
[30]The applicant’s evidence was supported by photographs of the Vespa showing it to be covered in dust when the applicant was arrested. In fact, the applicant conceded that he had not ridden the Vespa for many months.

The applicant conducted his defence to charges 1 and 2 on the basis that Witness A’s evidence was a lie. Once the jury decided that the applicant was, at the time of his arrest, in possession of the gun and ammunition, it was but a short step to conclude that he was also in possession of these items at the time of the alleged threats. In those circumstances, they were then entitled to treat that finding as supporting Witness A’s credibility.

Was the evidence ‘unfairly prejudicial’ in relation to charges 1 and 2 (extortion)?

Section 137 of the Act requires a balancing exercise to be undertaken. If that balancing process results in a finding that the probative value is outweighed by the danger of unfair prejudice, the Court is constrained to refuse to admit the evidence. No element of discretion arises.[31]
[31]See R v Cook [2004] NSWCCA 52. We note that ground 2 in the present case is couched in the language of an attack of the exercise of discretion. Insofar as that ground relies upon s 137, it is drafted in misconceived terms. The section does not, as we have said, involve any exercise of discretion, but rather, a balancing exercise.

For the reasons we have given, we consider the probative value of the evidence concerning the finding of the gun and ammunition to be substantial. Nonetheless, we must consider for ourselves whether the probative value of that evidence was outweighed by the danger of unfair prejudice to the applicant. The word ‘danger’ connotes more than ‘a mere possibility’. It requires a ‘real risk of unfair prejudice’.[32] Where any potential prejudice is minimal but the evidence has significant probative value, it will not ordinarily warrant exclusion under s 137.[33]
[32]See R v Lisoff [1999] NSWCCA 364 [60].
[33]See R v Mundine (2008) 182 A Crim R 302.

For reasons that will shortly become apparent, it will be seen that, as regards charges 1 and 2, there was no basis for excluding this evidence under s 137.

Was the gun and ammunition relevant to charge 5 (trafficking)?

As noted earlier, the charge of trafficking was based upon the extended definition of that term in s 70 of the DPCS Act. That definition relevantly provides that the offence can be constituted by an ‘offer for sale’.

As previously indicated, there was no dispute at trial as to what the applicant said to Witness A during the course of the recorded conversation. Clearly, his words signified an offer to sell Witness A ice for $145,000 per kilo. In addition, he assured Witness A that the quality of the drug was good, and indicated that even larger amounts were available.

The only issue that the jury had to determine was whether, as the prosecution contended, the offer to sell at least a kilo of ice was genuine.

Of course, the prosecution could have confined its case on charge 5 to simply playing the recording of the conversation, and having Witness A explain what some of the terms used in the discussion actually meant. The applicant could then have given his alternative account of what transpired, explaining that he was simply ‘testing’ Witness A. The jury would then have had to decide whether they had a reasonable doubt about Witness A’s account.

The prosecution went further, however, and sought to rely upon the gun evidence in support of the trafficking charge. As we have said, s 55 creates a low bar. The question is whether evidence that, on the day of the recorded conversation, the applicant had ready access to a concealed semi-automatic handgun and ammunition could have rationally affected the assessment of the probability of the offer for sale being genuine.

At no time did defence counsel contest the basis upon which the gun evidence was said to be relevant. To the contrary, as will be seen, defence counsel conceded relevance in pre-trial discussion.

As will appear, we regard the gun evidence as having significant probative value on the question whether the offer made was genuine. It therefore comfortably met the threshold of relevance.

Was the evidence ‘unfairly prejudicial’ in relation to charge 5 (trafficking)?

The threshold test of relevance being met, there is still the question whether evidence of the finding of the gun and ammunition was ‘unfairly prejudicial’, within the meaning of s 137, so far as charge 5 is concerned.

Clearly, in seeking to have this evidence led in support of the charge of trafficking, the prosecution was relying upon the proposition that guns and ammunition are ‘accoutrements’ of large scale drug trafficking of the kind here alleged.

In the present case, Priest JA would distinguish decisions such as Sultana and Blackwell. In his Honour’s view, the facts of the present case bear few parallels with those earlier authorities. One important difference is said to be the absence of sufficient contiguity between the possession of the gun and ammunition and the allegedly incriminating conversation. That conversation took place some two weeks or so before the finding of the items in question. His Honour considers that gap in time to be significant, as in some cases it plainly would be.[34]
[34]See [288] below.

We have already dealt with the probative value of the gun evidence in support of charges 1 and 2. In our opinion, the same result follows from an analysis of the authorities with regard to charge 5.

As previously indicated, the applicant, on his own evidence, acknowledged that, as at the date of the recorded conversation, the Vespa had been parked in the basement of his apartment building for the best part of a year. He also acknowledged that throughout that entire period, he had been in possession of two keys to the Vespa, one of which he kept in his satchel, and another in his apartment.

In light of Sultana and Blackwell — and also, to some degree, of the High Court’s decision to allow the appeal in Falzon — we are not persuaded that the trial judge erred in admitting this evidence in support of charge 5.

From the outset of the trial, the prosecutor made it clear that he would be presenting a circumstantial case in order to provide the necessary context within which the jury could assess the character of the recorded conversation. More particularly, counsel said that he would seek to show that the applicant was in the business of drug trafficking. As the prosecutor said:

[T]o give meaning and understanding to that conversation, the prosecution case is assisted by other evidence of [the applicant] being a longstanding drug trafficker.

The prosecutor identified a number of elements of the circumstantial case. He said that it would include evidence of:

·the earlier sale of cocaine by the applicant to Witness A for on-sale to Toby Mitchell;
·the series of drug deals in Perth which Witness A did on behalf of the applicant;
·intercepted conversations referring to drug dealings;
·the applicant’s possession of a number of phones and, in particular, a Blackberry; and
·the gun and ammunition found in the Vespa motorcycle.

In answer to a question from the judge, the prosecutor confirmed that the evidence proposed to be called was intended to demonstrate that the applicant was a drug dealer. Defence counsel then made reference to ‘the drugs, the weapons, the ammunition and the money’, and the judge responded:

It’s starting to paint a compelling picture of a drug dealer.

The prosecutor pointed out to his Honour that he would need ‘to determine the issue of probity [sic] against prejudice.’ This was obviously a reference to s 137 of the Act. The prosecutor then said:

It’s a kaleidoscope of indicia of drug dealing …

The judge soon after noted that ‘exactly the same point’ applied to the evidence of the possession of the Blackberry as it did to the possession of the gun, that is:

Does it tend to strengthen the prosecution witness’ evidence? Is it material surrounding circumstances which give context to the — which can, if the jury choose to, use to rely upon to support his evidence?

At no time did defence counsel contest the basis of relevance asserted by the prosecutor. To the contrary, defence counsel expressly conceded relevance. The circumstances which surrounded that concession were as follows.

The discussion concerned the severance of the charge of being a prohibited person in possession of a firearm. The judge said:

but in the context of the allegations and there is relevance, I think, to the — if he has [the gun], and I know you deny he has it … possession of the pistol and the ammunition, it goes somewhat to give flavour and colour and force to the …

The judge then said to defence counsel:
As I understand you, if I severed off the charge of prohibited person possessing a firearm but allowed the evidence [of possession] to be led, you would not be concerned about that.
Defence Counsel: I don’t think I could resist your Honour’s observations about its relevance.

The judge then said to the prosecutor:
You can work on the basis that will be happening.

In our view, defence counsel’s concession of relevance was correctly made. As appears from the discussion of the authorities earlier in these reasons for judgment, courts have consistently affirmed the relevance of evidence of this nature when what is in issue at trial is the character of a particular circumstance. In a number of the decided cases, the relevant circumstance has been the accused’s possession of drugs, and the fact in issue has been the purpose of that possession.

We accept that the facts of the present case differ from those in Sultana, Blackwell, and Falzon in at least two respects. First, there were no actual drugs found in the applicant’s possession. The case against him was about an offer for sale, and whether that offer was genuine. The relationship between that fact in issue and the items found in the Vespa is, in that sense, less direct than in those other cases.

Secondly, there was a gap of about two weeks between the recorded conversation, and the finding of the gun and ammunition. However, once the jury found, as they almost certainly did, that the applicant had been in possession of these items at the time of the conversation, that gap in time ceases to have any real significance.

As previously noted, the nexus between the possession of firearms and drug-dealing was specifically addressed by Gleeson CJ in Sultana as follows:

Common sense indicates that supplying heroin on the street … is a dangerous activity. A jury would be entitled to reason that possessing firearms … would be appropriate to the business of a street heroin dealer.[35]

[35]Sultana (1994) 74 A Crim R 27, 29.

Although the activity which Gleeson CJ here described as ‘dangerous’ was that of ‘supplying heroin on the street’, there is no basis for confining the probative force of such evidence to cases of street-level dealing. Self-evidently, his Honour was simply addressing the case before him. As the authorities recognise, drug dealing is notoriously dangerous at any level. Indeed, it might be thought that it becomes more dangerous the larger the quantities — and associated sums of money — changing hands. The general point was clearly made in Blackwell:

It is well known that drug dealers may become involved in situations which place their personal safety as risk. Accordingly it is not unknown therefore for dealers to arm themselves.[36]

[36]Blackwell (1996) 87 A Crim R 289, 290.

In this case, there was no need for the jury to make assumptions about whether the carrying of guns was characteristic of drug dealing. The evidence given by Witness A, which was unchallenged on this point, demonstrated that guns were very much ‘tools of trade’ for drug dealers working in this particular milieu.

Early in his evidence, Witness A described the meeting which he and Michael Pastras had had with Mitchell on 26 December 2010. As noted earlier, Witness A’s evidence was that he had purchased a kilo of cocaine from the applicant and then supplied it to Mitchell. Once he had been paid by Mitchell, he was going to pay the applicant the agreed price of $350,000.

The meeting on 26 December was about Mitchell's failure to pay for the drugs. Witness A took a gun with him to that meeting. As soon as Mitchell arrived, a fight broke out. It quickly became a gunfight. Witness A described how Mitchell’s face turned white when he saw Pastras. In cross-examination, Witness A confirmed that he believed that this was because Mitchell was afraid that Pastras was armed, and might have killed him.

The cross-examination thus proceeded on the basis that Witness A was telling the truth about people having been armed, and about shots having been fired. The defence case was that the dispute was indeed about a drug debt but that it was not a debt which involved the applicant in any way. Instead, it was contended, Witness A had a debt to some people in Sydney, arising from drug deals which he had been engaged in on his own account. In effect, the defence positively affirmed the dangerousness of drug-dealing and that it was unremarkable for Witness A himself to have gone to the meeting armed.

Subsequently, Witness A gave evidence that when he first met Mitchell, Mitchell asked him ‘where the gun was’. Witness A had responded by lifting his top and saying ‘I haven’t got a gun’. Again, there was no challenge to this evidence. Mitchell obviously assumed that Witness A would be armed for a meeting about a drug debt.

When Mitchell refused to pay, Witness A told the jury, the applicant said to him that he either had to pay the debt which he owed to the applicant or else kill Mitchell. It was put to Witness A under cross-examination that he had earlier said he was going to kill Mitchell. Witness A said, ‘We were gonna organise it, yeah’. There was no suggestion from the defence that the killing of Mitchell for his failure to pay was, in itself, an implausible notion. Instead, the attack on Witness A was to the effect that he had lied in attributing to the applicant the suggestion that Mitchell be killed, and that he had done so in order ‘to feather [his] own nest’.

Subsequently, defence counsel insisted on putting to Witness A (from one of his police statements) a conversation he had had with police about why he should not enter into a written contract with the applicant concerning the so-called debt owed to the builder. Witness A was asked whether he was told that:

the police concerns were that by signing a contract, and that a caveat being placed on the house, [the applicant] would no longer would need you and you would be expendable.

Witness A responded that this conversation ‘may have’ taken place. Subsequently, the trial judge pointed out to defence counsel - correctly - that this puttage tended to discredit the applicant. The judge asked:

What [on] earth is the relevance that the policeman says to [Witness A] ‘Be careful about signing the contract or [the applicant] … will kill him?’

As can be seen, the unchallenged evidence of Witness A (including under cross-examination) painted a very vivid picture of just how dangerous it was to be involved in drug dealing of this nature, and on this scale. The milieu in which Witness A admitted having operated in for years, as a long-term major drug dealer, was obviously a very violent one. The probative value of this evidence did not depend on it being shown that the applicant himself had carried, or used, a gun in any particular transaction. Rather, it established what otherwise would have needed to be assumed, namely, that guns were a part of the ‘tools of trade’ of drug traffickers, at least on this scale.

On that basis, the evidence that the applicant was in possession of a gun and ammunition, both before and after the conversation the subject of charge 5 took place, had substantial probative value. Of course, that evidence was not to be considered in isolation. Rather, it had to be considered together with all of the other evidence bearing on the question whether the applicant was indeed in the business of drug trafficking.

By parity of reasoning with cases such as Sultana and Blackwell, evidence of this kind may be relevant to establishing the character of a circumstance other than bare possession of drugs. In this case, the circumstance was the recorded conversation between the applicant and Witness A. Proof that the applicant was in the business of drug dealing was capable of ‘rationally affecting’ the jury’s assessment of the probability that what he claimed was a ‘try on’ was in fact — as the prosecution contended — a genuine offer to sell drugs. As already pointed out, defence counsel conceded that this was so.

The cases also establish that evidence of relevant prior conduct can be probative for this purpose. As was said in McGhee,[37] the relevance of evidence:

tending to prove the existence of an ongoing business … cannot be called in question merely because it shows that the [accused] has committed offences in the past and thus has a criminal disposition.[38]

[37](1993) 61 SASR 208.

[38]Ibid 211.

A point of distinction between the applicant’s case and that of the appellant in Sultana, the force of which we acknowledge, is the sheer volume of incriminating items located at Sultana’s place of residence. It will be recalled that a series of items were located there, including cash, resealable plastic bags, a grinder, a penknife, a replica revolver and a pen pistol. As we have said, Gleeson CJ remarked that ‘[n]one of the items in question, standing alone, would point to the nature of the appellant’s occupation’.[39] In other words, it was the ‘combined effect’ of the items, ‘in conjunction with other evidence in the case’ that was important.[40]
[39]Sultana (1994) 74 A Crim R 27, 30.
[40]Ibid.

In the present case, there were, as has been seen, a number of references to guns and ammunition and their having been used in the course of drug-related activities. The entire account given by Witness A was replete with references of that kind, including what seems to have been a gun battle with Toby Mitchell.

While it is true that the references to guns were not linked to the applicant personally, the very fact of his close association with a host of others who were ready and willing to use such weapons, almost at the drop of a hat, gave greater force to the argument that the items located in the Vespa should be seen as ‘accoutrements’ of drug trafficking.

In our view, the danger of unfair prejudice was not such as to outweigh the probative value of the gun evidence in relation to charge 5. Accordingly, the judge was not obliged to exclude it under s 137.

Defence counsel’s conduct of the trial

The applicant was represented by experienced senior counsel at trial.[41] When the trial judge ruled that the gun evidence was admissible on charges 1 and 2, and on charge 5 as well, there was scarcely a murmur of dissent from the defence. There was no request for his Honour to give reasons in a formal ruling, nor was any subsequent attempt made to persuade his Honour to revisit that ruling. In particular, there was no attempt to draw his Honour’s attention to any of the relevant authorities dealing with the admissibility of evidence of incriminating material.
[41]This was not senior counsel who appeared on the applicant’s behalf before this Court.

The judge indicated, in discussion with defence counsel, that the finding of the gun and ammunition was, in his view, ‘the only thing that really is controversial’. His Honour added ‘I think that is relevant’.

At that point, senior counsel said to the judge, ‘I assume that Your Honour in those comments has already looked at and considered s 137’. The judge responded, ‘137 is the prejudice side of it. There is no prejudice if [the gun’s] not yours’. He added that the finding of the gun made ‘more likely and more credible’ what Witness A had said about the threats that were made (clearly referable to charges 1 and 2). The applicant’s counsel simply responded, ‘Yes’.

Not only was there no application for a separate trial on charge 5, but senior counsel did not take any exception to the way in which the prosecutor addressed the jury regarding that evidence in support of charge 5. The attack on the decision to admit the evidence at trial, specifically in relation to the charge of trafficking, was mounted for the first time before this Court. It was only at that stage that we were finally provided with a careful analysis of the relevant case law governing this subject. It must be said that the conduct of the trial was, in that respect, unsatisfactory. It is a far cry from the philosophy that underlies the enactment of the Jury Directions Act 2015. Defence counsel are expected to take a more robust role than appears to have been adopted in this case.

The prosecutor had correctly identified the s 137 question as one which the judge would have to determine. Self-evidently, it was for defence counsel to decide whether, and when, to develop argument in support of an application to have the evidence excluded under s 137. It appears that this never occurred. It did not occur pre-trial, or after the evidence was led, or at the conclusion of the evidence in the trial, or at any time in the course of the charge.

The prosecutor’s closing address regarding charge 5 was squarely grounded in the circumstantial case which he had identified at the outset of the trial. Counsel told the jury that the intercepted conversation was:

a fair dinkum, genuine conversation about drugs, which shows that it’s built on, and comes from, their previous drug trafficking association. … It’s the sort of conversation you have where, as Witness A has truthfully told you, they were in business together. In drug-trafficking business, that's where it all comes from, and why they slip into it.

Further, and more particularly:

The prosecution submits to you that it's a genuine offer, not only because of [Witness A’s] evidence and this analysis of the actual tape, but also because there is other evidence to show that [the applicant] is genuinely, at the time in question, a genuine drug dealer, and in particular, as put to him, he had the tools of the trade and by this, I'm referring - and I’ll come to it very shortly - the gun, the handgun and ammunition that's in the Vespa in the apartment carpark. His possession of the Blackberry phone, not - and I submit to you, you should reject it - a phone that he had found on the worksite and was holding for some other worker there and coincidentally had it in his bag when arrested by police on 5 March. That is, with respect, something you should reject, but again, a tool of the trade because of the special attractions. The secure code and the inability of the police to penetrate the Blackberry-type phone, ideal for this line of work and again, as put to [the applicant], so is - as a necessary part of that line of work - a handgun and ammunition. It's a genuine offer. The evidence supports [Witness A’s] evidence, not only of the particular charge, but also the previous relationship and in particular, the illegal drug debt that started all this back when things went wrong at Allard Park or before that actually, before the - which I'll come back to - the incidents that you hear evidence about of the shootings and so forth at Allard Park.

For his part, defence counsel did not refer to the gun and the ammunition until the very end of his final address. After referring to ‘a gun and ammunition found in the storage compartment [of the Vespa]’, counsel made two brief submissions. The first — which the judge had to point out was incorrect — was that another witness had admitted ownership not only of the bike but also of what was found in it. The other was that the evidence of the Blackberry and the gun was ‘a mischief … a distraction’.

As already noted, there was never, at any stage, an application on behalf of the applicant to have charge 5 severed from the indictment. The only application for severance concerned charges 6 to 8, which dealt with the finding of the gun and ammunition (together with a small quantity of a precursor drug).

When considering whether the trial judge should have excluded the gun evidence in relation to charge 5 on the basis of s 137, it is necessary to have regard to the conduct of the trial and the various forensic choices made below.

The Jury Directions Act 2015

It was always open to the applicant to request the judge to direct the jury, in strong terms, that the gun evidence was admissible only in relation to charges 1 and 2, and should not be taken into account when considering charge 5. The fact that his Honour had given an off the cuff ‘ruling’ to the effect that the evidence was admissible in relation to charge 5 as well did not prevent counsel from seeking such a direction.

The Jury Directions Act 2015 imposes significant obligations upon counsel when it comes to seeking proposed directions. Where no direction of the kind contemplated above was sought, and where such a direction might well have ameliorated any arguable prejudice flowing to the applicant from the ‘spillage’ of this evidence from charges 1 and 2 to charge 5, this Court will not readily conclude that this resulted in a substantial miscarriage of justice.

At the conclusion of the evidence, the judge discussed with counsel the respective requirements of ss 11 and 12 of the Jury Directions Act 2015. His Honour specifically pointed out that, under s 12 of that Act, counsel were obliged to tell him which directions they wanted the jury to be given, or not given. Defence counsel then requested directions on prior inconsistent statements and the evidence given under s 38 of the Act, and an unreliable witness warning. Counsel made no reference, however, to the gun evidence and made no request for an anti-propensity or other similar warning.

In the exchanges with the prosecutor which followed, however, there was specific discussion about the gun evidence. The judge put to the prosecutor, who agreed, that the jury could not use that evidence unless they were satisfied beyond reasonable doubt that the applicant was in possession of the gun and the ammunition. His Honour then returned to the question of the relevance of the gun evidence. The following exchange took place:

His Honour: It seemed to me to be relevant for two reasons, to support the propositions of the threat to shoot, it makes it more likely that someone with a gun would say those things …
Prosecutor: Yes.
His Honour: … and I don’t know whether you go further and say that it's the sort of kit and caboodle of the drug dealer.
Prosecutor: I do, Your Honour.
His Honour: All right.
Prosecutor: I think, again, as put to [the applicant], that the possession of not only the gun and the ammunition but also the Blackberry phone are all the tools of the trade, if you like, so far as the offer of …
His Honour: Five, drugs, gun and the Blackberry.
Prosecutor: Your Honour …
His Honour: I’ll hear – I’m not cutting you out on this…
Defence counsel: Yes, I understand that.
His Honour: I’ll just hear what [the prosecutor’s] putting and come back to you.

In the event, although the judge had specifically reserved to defence counsel the right to do so, he made no further submissions on the subject of the gun and ammunition.

Plainly enough, defence counsel was given every opportunity to make a submission that the gun evidence should be excluded under s 137 because of the danger of unfair prejudice. Similarly, counsel had every opportunity to seek an anti-propensity warning with respect to that evidence. Counsel was, of course, under a statutory obligation under s 12 of the Jury Directions Act 2015 to do so if it was considered necessary that such a warning be given.

In oral argument during the course of the appeal, senior counsel for the applicant acknowledged that no such direction had been sought. Evidently recognising the force of ss 12–15 of the Jury Directions Act 2015, counsel explained that there was — as a result — no ground of appeal complaining that the judge should have given an anti-propensity warning and, by implication, that he thereby felt constrained not to seek to argue the point.

It was submitted, nevertheless, that the evidence should have been excluded under s 137, and that this Court should so hold. The particular danger of unfair prejudice relied on was that the gun evidence would unfairly lead the jury to engage in impermissible reasoning that, because the applicant was in possession of a gun, he was a person with a criminal disposition. From that, it would be inferred that he had engaged, and/or was likely to engage, in criminal activity.

The question whether the evidence should have been excluded is, of course, quite separate from the question whether an anti-propensity direction could, or should, have been given. Nonetheless, appellate decisions on s 137 are consistent and clear in holding that the danger of unfair prejudice for the purposes of that section must be assessed, at least in part, by reference to the capacity of the judge, by giving directions, to reduce or eliminate any such prejudice.[42]
[42]See, for example, Dupas v The Queen (2012) 40 VR 182, 219 [142], 221 [150]; MA v The Queen (2011) 31 VR 203, 209–10 [25]; R v Shamouil (2006) 66 NSWLR 228, 239 [72], [74]–[75]; R vEm [2003] NSWCCA 374 [121]–[122]; Cruz v The Queen [2017] ACTCA 48 [33].

Thus, in Bray (a pseudonym) v The Queen,[43] the Court referred to the ‘mechanisms available to ensure a fair trial,’ including the capacity of the trial judge to give ‘appropriate and strong directions to the jury’.[44] Recently, in R vDickman,[45] the High Court endorsed the view of the trial judge — and of Whelan JA in this Court — that the warnings to be given to the jury on identification evidence would ‘minimise any risk that the jury might give the evidence disproportionate weight’.[46]
[43](2014) 46 VR 623, 645 [101].
[44]Ibid 645 [101].
[45](2017) 344 ALR 474, 482 [36]–[38], 484 [47], 486 [57].
[46]Ibid 484 [47].

As Gleeson CJ and Hayne J said in Dhanhoa v The Queen,[47] the Act applies ‘in an adversarial context’.[48] Their Honours said ‘[i]t is the parties, and their counsel, who define the issues at trial [and] choose the evidence that they will lead, and to which they will take objection.’[49] In that case, the defence had sought no directions or warnings with respect to the identification evidence. As their Honours noted:

Counsel may have any one of a number of reasons for not objecting.[50]

[47](2003) 217 CLR 1.

[48]Ibid 9 [20].

[49]Ibid.

[50]Ibid.

In Cooper v The Queen,[51] Priest JA (with whom Harper JA agreed) concluded that the judge should have given a propensity warning. It was, however, fatal to the ground of appeal that no exception had been taken. His Honour said:

[Had counsel] imbued with the atmosphere of the trial … thought that a propensity warning was needed to protect his client's interests, he would have taken a further exception.[52]

Further, his Honour said:
[C]ounsel may well have thought that a more elaborate direction might have drawn more attention to the subject than was desirable.[53]

[51][2013] VSCA 153.

[52]Ibid [13]–[14].

[53]Ibid. See also R v Wright [1999] 3 VR 355, 360–1 [16]–[17].

Assuming for the moment that an anti-propensity direction might have reduced, or at least significantly ameliorated, any unfair prejudice, we can readily understand why defence counsel would have taken the view that as little as possible should be said about the gun and ammunition. That may explain why, in his closing address, he scarcely mentioned that evidence.

It must be understood that this Court will not lightly entertain arguments about unfair prejudice for the purposes of s 137 where the defence could have requested a direction or warning which would at least have ameliorated such prejudice, but chose not to do so. To proceed otherwise would be to subvert the clear intent of the Jury Directions Act 2015, which is to make unambiguously clear that the responsibility for seeking necessary directions rests with trial counsel.[54]
[54]See Dunn (a pseudonym) v The Queen [2017] VSCA 371 [4]–[6], [85].

Inevitability of conviction

If, contrary to our primary conclusion, the jury should not have been permitted to use the gun evidence when considering charge 5, there was still, in our opinion, no substantial miscarriage of justice arising out of the conviction for that offence.

As we have previously stated, the only realistic chance that the applicant had of being acquitted on charge 5 lay in his being able to raise a doubt as to whether the words that he used had an altogether different meaning, at least so far as his own state of mind was concerned. That obviously depended on his evidence being capable of acceptance by the jury.

It is trite that the rejection by a jury of an exculpatory account given by an accused is not ordinarily capable of being regarded as positive evidence of guilt. A case such as the present is different in certain key respects. In a practical sense, the applicant bore what Lord Denning once called a ‘provisional burden’, in the sense that as a matter of prudence, he really had to answer the case made against him. If he failed to do so, he might well, though not necessarily, find himself convicted.[55] Professor Cross described this as a tactical shifting of the burden of proof.[56]
[55]Lord Denning, ‘Presumptions and Burdens’ (1945) 61 Law Quarterly Review 879.
[56]See J D Heydon, Cases and Materials on Evidence (Butterworths, 2^nd ed, 1971) 28–30.

Once the jury rejected the applicant as a credible witness, which they certainly did in this case, there really was no viable defence to charge 5. In fact, it may be doubted that the gun evidence played any significant role at all in the jury’s determination that the applicant’s words of offer were genuine.

Of course, to speak of a tactical shifting of the burden of proof is not, in any way, to diminish the overall and ultimate burden that rested on the prosecution of proving beyond reasonable doubt that the offer was, indeed, genuine. In that regard, the prosecution had to exclude all reasonable hypotheses consistent with innocence.

In assessing whether there may have been a substantial miscarriage of justice within the meaning of s 276(1)(b) of the Criminal Procedure Act 2009, regard must be had to Baini v The Queen.[57] Baini establishes that a miscarriage of justice may occur where this Court cannot be satisfied that an error or irregularity in the trial, assuming that such error or irregularity is established, did not make a difference to the outcome of the trial.[58]
[57](2012) 246 CLR 469 (‘Baini’).
[58]Ibid 479 [26].

If this Court determines that a finding of guilt was, in a relevant sense, inevitable notwithstanding the error or defect in the trial, that may lead to the conclusion that no substantial miscarriage of justice occurred. The essential enquiry is whether the guilty verdict was, from a practical point of view, inevitable. If the jury, acting reasonably, may have entertained a doubt as to guilt, the guilty verdict cannot be said to have been inevitable.

Having reviewed for ourselves the entire body of evidence in the trial, and having taken into account the course taken by defence counsel below, we are satisfied that the admission of the gun evidence in support of charge 5 did not constitute or result in a substantial miscarriage of justice.

We have carefully studied the transcript of the applicant’s evidence. He was, in our view, a witness whose evidence simply could not be accepted. It was lacking in credibility. We can well understand why the jury arrived at that conclusion.

The clear rejection by the jury of the applicant’s contrived and spurious account of how and why he came to offer to sell a kilo of ice to Witness A clearly put an end to any realistic defence to that charge. In that sense, the conviction on the charge of trafficking was inevitable.

Although we have earlier provided a brief summary of the facts in this case, it is necessary to set out in some detail why we say the conviction on charge 5 was inevitable. That requires a more complete summary of both the applicant’s evidence in chief and under cross-examination.

The applicant’s evidence-in-chief

The applicant began by saying that he had known Witness A for many years. They had grown up living near one another. He agreed that he also knew Toby Mitchell, who used to frequent a café that was owned by the applicant’s family.

The applicant claimed that Witness A’s evidence of having approached him in 2010 in order to supply him with a kilo of cocaine, which Witness A was to on-sell to Mitchell, was ‘nonsense’. He claimed that although Witness A had indeed approached him for money at that time, it was to repay a debt that was owing, and not to purchase drugs.

According to the applicant, Witness A had told him that he owed some ‘guys’ from Sydney $150,000. The applicant was a heavy gambler at the time. He said that he had plenty of money. He claimed that Witness A had proposed to him that if he loaned Witness A $50,000, he would be repaid twice that in 12 months.

The applicant said that he agreed to that proposal. He claimed that he handed over a brown paper bag containing $50,000 in cash. However, Witness A subsequently went back on the deal, prevaricated when pressed for payment, and thereby evaded repayment of the debt.

The applicant was then asked about Witness A’s evidence concerning charge 1. It will be recalled that Witness A claimed that on 13 July 2014, the applicant had threatened to ‘shoot up’ his family’s property. The applicant denied having made any such threat.

The applicant did not, however, deny Witness A’s account of his having demanded $100,000. He claimed that this was regarding repayment of the original $50,000 cash loan, and had nothing whatever to do with any sale of cocaine.

The applicant repeatedly insisted that he had tried unsuccessfully, over a lengthy period of time, to turn the matter of the loan over to his lawyers. He did not deny Witness A’s reference to $10,000 being payable by way of GST. However, he said that this was purely a mechanism to enable him to recover the original sum loaned. He claimed that the GST had become an issue because ‘we were going to do an invoice because [Witness A] said his wife wouldn’t come to the lawyers’.

The applicant said that because neither Witness A nor his wife were prepared to cooperate, it was decided that a fake invoice should be created, signifying work ostensibly done on Witness A’s house. According to the applicant, the true figure for that work was somewhere around $4,000 to $4,500. For the purpose of the invoice, however, the price was inflated to $110,000. The applicant said that he organised the landscaping to take place, and he regarded Witness A as responsible for the payment of the bill. However, Witness A did not pay any part of that amount.

As regards charge 2, the threat said to have been made on 11 September 2014, the applicant insisted that he never sought to extort money from Witness A. He denied having threatened to ‘shoot’ Witness A, or any member of his family.

The applicant agreed that he was upset when he went to visit Witness A on that day. He claimed that the visit had nothing to do with the $100,000 that he was owed, but instead related solely to the relatively small sum owing to the landscaper.

He said that he had challenged Witness A about not having paid that sum. He acknowledged that he had grabbed Witness A by the shirt, and said that Witness A had, in turn, grabbed him. They had ‘a bit of a wrestle’ out the front of Witness A’s house. The whole episode occupied only a minute or so. He denied having punched Witness A to the jaw, or having inflicted any blow of that kind to him.

According to the applicant, B then became involved. When he told her that Witness A had not paid the landscaper, she ‘freaked out’. She supposedly said, ‘that’s it, I’m divorcing him’.

The applicant denied having been responsible for damaging Witness A’s house and car. He said that B had asked him whether he was ‘behind it’ and he had told her that he was not.

As regards charge 5, the applicant agreed that at their meeting on 19 February 2015, Witness A had handed over $25,000 in cash, which the applicant had put in his car.[59] Moreover, Witness A had promised to pay him an additional $25,000 to $30,000, a week or so later.
[59]It will be recalled that, unbeknown to the applicant, this money had been supplied to Witness A by police.

The applicant claimed that moments before the recorded conversation with Witness A took place, he had said to J, who was there at the time, that he believed Witness A was ‘up to no good’. He claimed that he had told J that he was ‘going to have a go at him’, to ‘suss him out’, and ‘to see if he was up to his old tricks selling drugs again’.

The applicant was then asked about the recorded conversation. He agreed that it was his voice on the tape. He also agreed that the transcript was accurate. When asked about his use of the term ‘dyno’ (which, he agreed, was short for ‘dynamite’, meaning high quality drugs), he said that he had just been ‘talking’. He claimed that he was trying to convince Witness A that he had a large quantity of ice available for sale. By implication, the applicant was suggesting that this was to persuade Witness A to bring along more money when they next met.

The applicant denied having made a serious offer to sell drugs. He added that he was ‘upset’ at the time, and that he had simply said whatever first came into his mind.

3.The learned trial judge correctly found that the trafficking in a large commercial quantity of a drug, was an offence which fell ‘towards the lower end of the ranges of sentences for such offending’, but he erred in law, and his sentencing discretion miscarried in sentencing that Applicant to be imprisoned for nine years;
4.That the sentences imposed, in each instance, were manifestly excessive; and
5.That the total effective sentence of 14 years was manifestly excessive in the circumstances.
[187]During oral argument, counsel for the applicant submitted that ground 2 ought to be seen as a particular of grounds 4 and 5, and not as a standalone ground.

Proposed grounds 1.1 and 1.2

It was submitted in support of ground 1.1 that the description of the applicant as a ‘complete outlaw’, was inflammatory, emotive and failed to have regard to the evidence given at both trials. While that description may have accorded with what was being said about him in the popular press, it was submitted that there was no evidence at all of the applicant having been involved in drug trafficking in the years 2012 to 2015, save for the recorded conversation on 19 February 2015.

It was further submitted that the sentencing judge had erred by failing to have regard to the fact that Witness A had voluntarily entered into the arrangement whereby the loan claimed by the applicant would be repaid.

It was submitted by the respondent that, self-evidently, that particular argument was entirely specious having regard to the evidence led at the applicant’s first trial and, in particular, the jury’s obvious acceptance of the thrust of Witness A’s account.

In relation to ground 1.1, it was submitted on behalf of the respondent that the evidence led at the first trial justified the sentencing judge’s finding that the applicant was ‘a complete outlaw’ at the relevant time. That evidence also justified the finding that he ‘saw Brunswick as his personal fiefdom’. It was plain, according to the respondent, that the applicant exercised control over a number of real estate agents, bankers and building contractors. It was also plain that he could persuade people like Z, J and Michael Pastras, to do whatever he asked them to do.

In that regard, the respondent noted that Z had been present when the false invoice that J had prepared was signed. Moreover, the recorded conversations between the applicant and Z demonstrated that Z was acting in the applicant’s interests, and not those of his actual client, Witness A. In addition, the applicant discussed with Z the state of the caveats over Witness A’s property. He told Witness A that Z would not talk to him unless the applicant was present.

It was also submitted by the respondent that the reference to the applicant ‘controlling banks’ was a reference to the applicant having arranged for Witness A to obtain a loan through one of the applicant’s contacts at the Commonwealth Bank.

As regards the applicant’s control over J, the respondent submitted that the evidence spoke for itself. It included an intercepted telephone call in which the applicant directed J as to what to say if contacted by the bank in respect of a loan application.

As for Michael Pastras, the respondent submitted that his evidence concerning the events of 27 December 2010, was plainly concocted to accord with the false account given by the applicant regarding the ‘loan’ to Witness A.

Proposed ground 1.2 complains of the sentencing judge’s finding that various unspecified witnesses who the applicant ‘called at both trials’, had lied about his involvement in extremely serious offending.

In so far as the witnesses in question were J and, to a lesser degree Michael Pastras, the point being made seems to be that they were called by the prosecution, and not by the defence. Nonetheless, it is clear that this was done at the behest of the defence. The prosecution sought and was granted leave to cross-examine them. In these circumstances, the point being made is without merit.

Insofar as this proposed ground relates to Delic, who was called by the defence in the second trial, no conclusion can be reached other than that he lied at the behest of the applicant, in an effort to protect him.

In our opinion, and largely for the reasons put forward on behalf of the respondent, there is no substance to either ground 1.1 or 1.2. The judge’s description of the applicant as a ‘complete outlaw’, who ‘saw Brunswick as [his] personal fiefdom’ was a rhetorical flourish. It was couched in emotive language, which would have been better avoided. Plainly, however, it was not intended to be taken literally, or to reflect his Honour’s actual assessment of the applicant’s true level of criminality. Rather, the sentencing judge was intent upon making it unmistakably clear that the applicant’s conduct should be strongly denounced.

The question is whether his Honour’s somewhat extravagant use of language bespoke an erroneous interpretation of the facts, or of the applicant’s background, of a kind that tainted the sentence imposed, and vitiated the exercise of the sentencing discretion. In our opinion, it did not.

We are reinforced in that conclusion by the careful manner in which his Honour, in other parts of his sentencing remarks, identified each of the aggravating and mitigating factors that were present. He articulated them clearly and explained why, in his view, they carried the weight that they did. All in all, the sentencing remarks were not suggestive of a judge who had lost sight of the salient facts, and the need to sentence according to law.

Proposed ground 1.2 in particular is entirely devoid of merit. It is based upon a technical error made by his Honour in describing the witnesses who lied as having been ‘called’ by the applicant. In fact, as was conceded by counsel for the respondent, two of these witnesses were called by the Crown, plainly at the behest of the applicant. Their evidence was never accepted by the prosecution as truthful, and their credibility was strongly challenged by the prosecutor at trial.

In these circumstances, there is no merit in either ground 1.1 or 1.2.

Proposed grounds 4 and 5, putting to one side the sentence on charge 5 (trafficking)

As regards these proposed grounds, it was acknowledged on behalf of the applicant that they did not admit of detailed argument. As noted earlier, proposed ground 2 became simply a particular of grounds 4 and 5.

It was submitted that the sentencing judge should not have found that the three instances of extortion, or the possession of the gun, were serious examples of those offences.

Before this Court, senior counsel added to that particular argument by submitting that the total cumulation of 12 months of the sentences imposed on charges 2 and 3 on the base sentence, was manifestly excessive. In particular, that was because the threat that gave rise to charge 2, and the blow to the jaw that gave rise to charge 3, both occurred within moments of each other. They therefore should have been viewed as essentially part of the same transaction, and attracted a large measure of concurrency.

It was also submitted that the two years and six months’ cumulation between the sentences imposed for the offences dealt with in the first trial, and those imposed in respect of the second trial, was manifestly excessive.

In particular, it was submitted that when sentencing the applicant for the possession of the gun, the sentencing judge had taken into account, as an aggravating factor, the applicant’s status as a ‘high-level drug dealer’. The only evidence of such ‘drug dealing’, at that stage, was the offer to sell that gave rise to the charge of trafficking in the first trial. The applicant had already received a sentence of nine years’ imprisonment for that particular conduct, and it could not therefore be used again as an aggravating factor on the charge of possession of the weapon. This was said to amount to a form of double-punishment.

The respondent submitted that the threats themselves, to shoot Witness A and his family, were inherently serious. So too, was the offence of being a prohibited person in possession of a firearm. The extortion charges, in particular, had to be viewed against the background of the applicant having, in the past, committed serious offences involving the use of a firearm in acts of extreme violence.

We are not persuaded that the sentencing judge fell into error in dealing with the extortion offences, or the offence of being a prohibited person in possession of a weapon. There is nothing to indicate that any of the individual sentences imposed on those charges, or any orders for cumulation, were inappropriate.

It was well open to his Honour to cumulate 12 months of the sentences on charges 2 and 3, on the base sentence. Equally, it was well open to cumulate two and a half years of the sentences imposed in respect of the second trial upon the total effective sentence of 11 years and six months imposed with regard to the first trial.

The sentencing judge’s reference to the fact that the weapon was in the applicant’s possession in the context of his being a major drug dealer does not, when read in context, indicate double punishment. Nor does it indicate a failure on his Honour’s part to recognise that the applicant had already been dealt with, by that stage, for trafficking. It is rather nothing more than a recognition that the offending involving the weapon took place against a particular background which made it more serious than it might otherwise seem.

The sentence on charge 5 (trafficking)

The sentencing judge found that the trafficking fell ‘towards the lower end of the range of sentencing for such offending’. That particular finding was open to his Honour, based upon the nature of the offence itself, and the quantity of the drug offered for sale. It was submitted on behalf of the applicant that a sentence of nine years’ imprisonment for an offence so characterised, could not be justified.

In oral argument, that submission was thoughtfully developed. It was contended that the objective gravity of trafficking by way of an ‘offer for sale’ could, in a particular case, be significantly less than the objective gravity of other more usual forms of trafficking, such as by way of possession for sale, sale itself, or supply. Trafficking by offer for sale can, in some circumstances, be entirely preparatory in nature, well removed from an actual supply of drugs.

It was noted that there was no evidence of any drugs being possessed in this case. Nor was there any evidence to suggest that there really was any likelihood that drugs would actually be supplied to Witness A, despite the applicant’s offer being genuine so far as he was concerned. In effect, the actus reus of this offence consisted of the utterance of a few passing words, in the course of a conversation about a number of other things.

Of course, the applicant’s moral culpability was every bit as great as that of an offender who had available to him, at the time, the drugs of which he spoke. We fully recognise that the applicant’s offer to sell a kilo or more of the drug was a genuine offer, and intended to be such.

However, the objective gravity of an offence involving drugs has more than one component. It involves, as a separate limb, the risk that the drugs which are being trafficked will find their way into the community. For several reasons, here, there really was never any such risk.

Of course, the fact that Witness A had shown himself unable to pay off even small debts, such as that allegedly owed to the landscaper, did not necessarily mean that he could not have arranged for the on-sale of drugs to someone else. That, after all, was said to have been the basis of the Toby Mitchell transaction. However, given his background, the prospects of his being able to organise such a sale, on profitable terms, would have to be regarded as questionable.

More importantly, the fact that Witness A was ‘wired up’ by the police meant that there was never any possibility of him actually receiving any ice from the applicant. In that sense, the risk of drugs finding their way from the applicant to Witness A, and then into the community, was minimal.

It was submitted on behalf of the respondent that the characterisation of this particular trafficking offence as being at the ‘lower end’ of the range, did not mean that the offending was not serious. That submission is, of course, plainly correct. Trafficking in a large commercial quantity of a drug of dependence carries a maximum term of life imprisonment. The applicant told Witness A that he could supply as much of the drug as might be required. He assured him that it would be of high quality. Deterrence, both general and specific, were of primary importance as sentencing factors.

One the other hand, it must be remembered that the sentencing judge properly characterised this particular offence as being at the ‘lower end’ for offending of this kind. The offer for sale involved one kilo, or perhaps more. One kilo was the threshold for large commercial quantity.[188] On a quantity based sentencing regime, this was at the very bottom of the range for this particular offence.
[188]The figure for a large commercial quantity of methylamphetamine has since been reduced from 1kg to 750g (for a mixture of a drug of dependence with another substance) by s 20 of the Drugs, Poisons and Controlled Substances Miscellaneous Amendment Act 2017.

It must also be remembered that the evidence overwhelmingly suggested that the offer that was made was in no way premeditated. The only reason it seems to have come up in the course of the conversation was the somewhat surprising, so far as the applicant was concerned, payment of $25,000 in cash by way of an instalment on a debt that was, by that stage, years old.

Although the applicant spoke of obtaining drugs from ‘the Asians’, there was a paucity of evidence to suggest that this offer for sale was part of a highly organised criminal enterprise. Moreover, nothing at all happened between the time of the offer and the date of the applicant’s arrest, some two weeks or so later. There was no follow-up, and one could reasonably infer that whatever the applicant’s intent had been when the offer was made, his own actions did not indicate a strong desire to pursue the transaction.

We understand, with respect, why Maxwell ACJ has formed the view that an offer for sale should not be regarded as inherently less serious than a sale itself. Of course, no distinction of that kind can be found in the language of the relevant section of the Drugs, Poisons and Controlled Substances Act 1981. In strictly legal terms, an offer to sell is on all fours with a sale. It is not inherently, and in every case, to be viewed as akin to an attempt to traffick (which would normally attract a significantly lighter sentence than the completed offence), but is rather a form of the completed offence itself.

It was submitted by the respondent that the point sought to be made by the applicant had already been determined against him by this Court in Taumoefolau v The Queen,[189] where it was said by this Court (Hansen, Whelan and Beach JJA):

The authorities we have reviewed make clear the importance of the fact that the legislative scheme governing trafficking does not distinguish between the acts which constitute ‘trafficking’ in such a way as to render less serious acts which do not result in distribution from those which do.[190]

[189](2015) 253 A Crim R 508 (‘Taumoefolau’).

[190]Ibid [33] (citations omitted).

In fact, Taumoefolau does not support the submission put forward on behalf of the respondent before this Court. The Court went on to say in that case:

The harm (actual and potential) … of particular conduct is a potentially relevant matter depending on the circumstances of each individual case. The sentencing judge is entitled to gauge the criminality of the conduct by its potential consequences and by the intentions of the offender notwithstanding what he or she was in fact able to achieve. … The fact that the conduct of the offender may be such as to render it unlikely, or even impossible, that he or she will achieve the objective is unlikely to mitigate an assessment of the criminality, and it will commonly have very little weight … In any particular case, actual harm, both its presence and its absence, can be taken into account …[191]

[191]Taumoefolau (2015) 253 A Crim R 508 [33], [36] (emphasis added) (citations omitted).

The specific acts giving rise to the charges in Taumoefolau formed part of a ‘complicated course of conduct’ which demonstrated an ongoing business of trafficking. Although not all of the conduct giving rise to the charges resulted in the actual sale of drugs, there was evidence that the applicant had substantial quantities of ice in his possession, and had made a number of arrangements for that drug to change hands.[192] In that sense, actual harm, both potential and actual, was properly to be taken into account.
[192]The Court described the sentencing judge’s characterisation of the applicant’s conduct as ‘most favourable’, from the offender’s point of view. That characterisation was ‘two ounces “actually transacted” and a “willingness or attempt to source and move seven to ten ounces”‘ at [40].

In R v Spaull and Rush,[193] the applicants were convicted of trafficking in ice by manufacture for sale, though their attempts to manufacture the drug were unsuccessful. In that case, the Court rejected an argument that the applicants’ criminality was reduced by the fact that – despite their best endeavours – there was no yield from their attempts to manufacture the drug. It should be noted, however, that there was no suggestion in that case that, generally speaking, a particular offender’s failure to achieve their goal could never be taken into account when considering the objective gravity of their offending.
[193][1999] VSCA 18 (‘Spaull’).

In Chandler and Paksoy v The Queen[194] the applicants were found to have been in possession of some 13 kilos of ice, which they had manufactured and prepared for distribution. In that case, Maxwell ACJ and Weinberg JA observed that:

Other things being equal, manufacturing a large commercial quantity of a drug for distribution is no less culpable than the distribution of that quantity of drug. The definition of ‘traffick’ in s 70 of the [Drugs, Poisons and Controlled Substances Act 1981] makes the manufacture of a drug of dependence an act of trafficking, in the same way as preparing a drug for trafficking and selling or offering for sale as an act of trafficking. Under this legislative scheme, the potential harm of the manufactured drug is viewed as seriously as the actual harm of the distributed drug.[195]

[194][2010] VSCA 338 (‘Chandler’).

[195]Ibid [25].

Of course, there is a difference between the ‘potential harm’ that results from manufacturing a large commercial quantity of a drug for distribution, and the less proximate conduct of someone like the applicant who, in somewhat abstract terms, merely speaks of offering a drug for sale. There is a difference between having in one’s possession a drug that is available for immediate distribution, and offering for sale, in the most general of terms, a quantity of that drug.

In Director of Public Prosecutions v Holder (a pseudonym),[196] the respondent trafficked large commercial quantities of ecstasy. Although not every supply in relation to which agreement had been reached eventuated, the respondent had, nonetheless, completed a number of large transactions. He was clearly equipped, by virtue of his possession of large commercial quantities of the drug at the relevant time, to enter further such transactions.
[196](2014) 41 VR 467 (‘Holder’).

In that case, the Court (Maxwell P, Neave and Redlich JJA) specifically addressed the relative seriousness of the various forms of trafficking contained within s 70 of the Drugs, Poisons and controlled Substances Act 1981. Their Honours observed that:

As the Director correctly submitted, trafficking is no less serious merely because some of the drugs trafficked are not in fact distributed to ultimate consumers. The legislative scheme which establishes the offence of trafficking does not distinguish between acts of trafficking on this basis. The potential harm of an unsold or unsupplied drug of dependence is viewed as seriously as the actual harm caused by the sale and distribution of the drug … In short, the seriousness of the trafficking is unaffected by the fact that drugs do not reach the public.[197]

[197]Ibid [25] (emphasis added).

Their Honours’ reasoning, in that passage, seems to us to have been unexceptionable. However, the present case was not one of an ‘unsold or unsupplied drug of dependence’, at least in the sense in which that expression was used in that case.

The conduct considered in Taumoefolau, Spaull, Chandler and Holder was rightly regarded as having been as serious as if the drugs had been distributed into the hands of consumers. In the present case, however, the applicant’s conduct was not accompanied by the features of exchange, sale, manufacture, possession or distribution, such as were present in those cases. It was an offer to sell, of a preliminary kind at that stage, and nothing more.

The risk that the distribution of drugs poses to the community is a relevant sentencing factor, and this Court has so held in cases of police undercover activity. In Director of Public Prosecutions (Cth) v Haidari,[198] Harper JA (with whom Weinberg and Priest JJA agreed) said:

It is also necessary to take into consideration the fact that the respondent’s offending put no one at risk; and that factor, when properly taken into account, diminishes the respondent’s culpability.[199]

[198](2013) 230 A Crim R 134 (‘Haidari’).

[199]Ibid [37].

Harper JA went on to cite the following passage in R v DW[200] per Hulme J:

[I]f the involvement of the authorities prevents the transaction from resulting in harm, it is illogical not to afford that fact appropriate weight just as in the converse situation one would take account of any damage that was a consequence of the offending.[201]

[200](2012) 221 A Crim R 63.

[201]Ibid 88–9 [117].

In some ways, the fact that Witness A was ‘wired up’ by the police, and provided with cash in order to ‘entrap’ the applicant, makes his situation somewhat analogous to that of the respondent in Haidari.

Counsel for the respondent, in her oral submissions, argued that a sentencing judge is entitled to assess the criminality of the conduct, not just by its potential consequences, but also by the intentions of the offender. Of course, that is a truism. Moral culpability is always of critical importance in assessing the gravity of an offence. So too, however, are the consequences of the offending, potential or actual.

At one stage during the course of argument, counsel for the respondent seemingly accepted that proposition. However, in the final analysis, she returned to the position stated in the written case, arguing that there was no difference in terms of the objective gravity of the offending, between an offer for sale and a sale. In other words, she rejected the proposition that there might be a hierarchy of seriousness as to the species of trafficking.

Common sense would suggest that the heinousness of any particular conduct should be viewed according to the particular facts of a given case, and not in the abstract. Fortunately, common sense happens, on this occasion, to accord with the most authoritative statement of principle by the High Court in that regard.

In Ibbs v The Queen,[202] the High Court observed that:

When an offence is defined to include any of several categories of conduct, the heinousness of the conduct in a particular case depends not on the statute defining the offence but on the facts of the case.[203]

[202](1987) 163 CLR 447 (‘Ibbs’).

[203]Ibid 452.

That case concerned an act of sexual penetration, where several distinct categories of penetration were included within a single section of the relevant statute dealing with sexual assault. All of those categories carried the same maximum penalty.

The statement of principle set out in Ibbs seems to us to be directly applicable to the particular issue raised by this proposed ground. We note that Ibbs appears not to have been cited in any of the cases upon which the respondent relied in support of her submission that there is no hierarchy of seriousness between the various forms of trafficking contained in the relevant Act. Yet, when the High Court has spoken upon a particular point, its decision is, for our purposes, the last word on that point.

An offer for sale of a large commercial quantity of drugs can, in a particular case, fall towards the higher end of the scale, rather than the lower end. It can, in an appropriate case, warrant a sentence of life imprisonment, or something approaching it. However, that is not to say that just because the maximum sentence for a particular offence is life imprisonment, a sentencing judge should do any more than bear that maximum in mind in assessing the gravity of the offence, as viewed by the legislature. It does not mean that any sentence imposed for a lower level form of the offence, as the judge found this to be, necessarily warrants such a sentence.

With great respect, we consider that the sentence of nine years’ imprisonment for this particular offence, committed in these somewhat unusual circumstances, to have been not merely severe, but outside the range that was reasonably available for offending of this nature. That translates to a conclusion that the sentence of nine years’ imprisonment was manifestly excessive.

Where, as in this case, a genuine offer to sell drugs is made but the conduct lacks what counsel for the applicant, in his written case, described as the ‘trappings of actual commerce’, a judge would not err by moderating, at least to some degree, the sentence based upon the lesser risk of harm likely to flow from that act of trafficking.[204]
[204]See R v Achurch (2011) 216 A Crim R 152, 168 [97], where Johnson J said, ‘although the fact that drugs are not disseminated in the community may be a relevant factor on sentence, the weight to be given to that factor will vary from case to case’. To the same effect, is the decision of the New South Wales Court of Criminal Appeal in Ly v The Queen [2008] NSWCCA 262, where Hislop J observed that, in a case of ‘deemed supply’, the fact that the drugs had not been disseminated in the community would not carry much weight by way of mitigation, because this was not an isolated occasion of possession for supply.

For these reasons, we consider that the sentence of nine years’ imprisonment on charge 5 was outside the range reasonably available to the sentencing judge.

We should add that we are fortified in that conclusion, to some degree, by reference to the Sentencing Advisory Council’s Sentencing Snapshot which stated that the average sentence in 2014–15 for trafficking in a large commercial quantity, was of the order of eight years’ imprisonment.[205] The average length of imprisonment of those sentenced in 2011–12 for that offence was some six years and five months. In 2013–14, it increased to eight years and six months. Of the 61 persons sentenced for that offence during the period 2010–11 to 2014–15, only 13 received a sentence of nine years or more. A total of 37 persons received sentences of more than five, but less than nine years.[206]
[205]Sentencing Advisory Council, Sentencing Snapshot No 195: Trafficking in a large commercial quantity of drugs (June 2016).
[206]Ibid. See also Stanley (a pseudonym) v The Queen [2017] VSCA 54 (sentence of 8 years’ imprisonment for trafficking in over 2 kilos of methylamphetamine); Cavanagh v The Queen [2016] VSCA 305 (sentence of 7 years’ imprisonment for trafficking in over 3 kilos of methylamphetamine); Tran & Chang v The Queen [2016] VSCA 79 (sentence of 12 years’ imprisonment for trafficking in over 13 kilos of methylamphetamine); McKinnell v The Queen [2014] VSCA 39 (sentence of 9 years and 9 months’ imprisonment for trafficking in ‘very significant amounts’ of methylamphetamine over a 12-month period). We are, of course, conscious of the limitations associated with treating the quantity of the drug as the sole, or perhaps even determinative, factor in assessing the gravity of the offence. See The Queen v Pham (2015) 256 CLR 550.

It can safely be assumed that although a number of these cases involved pleas of guilty (and there may have been other mitigating factors present), not all were to be regarded as being at the ‘lower end’ of objective gravity, as the sentencing judge found the applicant’s case to be.

Orders

In all the circumstances, we would grant leave to appeal against sentence on ground 3. We would set aside the sentence on charge 5. In lieu thereof, we would sentence the applicant on that charge to seven years’ imprisonment.

We would refuse leave to appeal on all other grounds.

The reduction of the sentence on charge 5 should lead to a reduction in the total effective sentence, encompassing both indictments, from one of 14 years’ imprisonment to one of 12 years’ imprisonment. We would fix a new non-parole period of nine years.

For the avoidance of doubt, we would affirm all other individual sentences, and all other orders for cumulation made below.

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[2018] VSCA 135

24 May 2018